Upper Tribunal Tax and Chancery Chamber

UT/2022/000131 - [2025] UKUT 00063 (TCC)

Fecha: 04-Nov-2024

Judge Jones also granted permission to appeal on the following additional new grounds

Judge Jones also granted permission to appeal on the following additional new grounds:

(b)

that the FTT misapplied and/or misinterpreted the (statute and case) law when upholding HMRC’s discovery assessments in the assessment appeals for the years 2001/02 to 2013/14, and 2015/16 to 2016/2017, in particular between paragraphs [231]-[241] of its decision, the FTT:

(i)

failed to identify and apply the legal test of what constitutes a discovery and the relevant case law;

(ii)

failed to identify and apply the correct burden of proof (being upon HMRC) that there had been a discovery;

(iii)

failed to address and give reasons for rejecting the Appellant’s argument that there had been no discovery, for example, because information relied upon by HMRC was produced during the section 9A TMA 1970 enquiry into tax years 2014/15; and

(iv)

failed to explain and give sufficient reasons why HMRC was entitled to make discovery assessments (in particular for assessments in relation to tax years up to 20 years earlier)

(Ground 2); and

(c)

that the FTT misapplied and/or misinterpreted the (statute and case) law when upholding HMRC’s penalty assessments in the penalty determination and assessment appeals for the years 2001/02 to 2008/09, and 2009/10, 2011/12 and 2012/13 to 2016/17, in particular:

(i)

it failed to identify and apply the test of what constitutes deliberate conduct;

(ii)

it failed to identify and apply the correct burden of proof (being upon HMRC) to establish whether there had been such deliberate conduct;

(iii)

it failed to give any substantive reasons for finding that the Applicant had acted deliberately in failing to file returns or filing inaccurate returns

(Ground 3).

15.

At the hearing of the appeal, it became clear that Mr Quinn had not appreciated the nature of a decision by the Upper Tribunal to grant permission to appeal, and was under the impression that Judge Jones had made a decision in favour of Mr Rafferty in respect of the grounds on which permission was given. Mr Quinn believed that the purpose of the hearing before us was to decide on the issues covered by the grounds for which permission was not given. We drew the attention of Mr Quinn to the following paragraphs included at the end of Judge Jones’ decision which were set out in bold text:

23.

It is to be emphasised that the grant of permission is acknowledgement that the appeal is arguable but does not indicate what the eventual outcome of the appeal will be. There is to be no guarantee or expectation that just because permission is granted, the appeal will succeed. It simply means that the appeal will proceed to a full determination after considering further submissions from both parties.

24.

The Applicant should also be made aware that should he choose to pursue his substantive appeal on which he has been granted permission but ultimately he is unsuccessful and the appeal is dismissed, he may be liable to pay HMRC’s legal costs of defending the appeal (which may be significant).

16.

We directed Mr Quinn to limit his submissions solely to the issues for which permission had been given, and we have not had regard to those parts of his skeleton argument that addressed the grounds for which permission had been refused.